AI-generated claims are on the rise: What your business should do about it

Businesses across virtually all sectors are seeing more complaints, claims and data subject access requests (DSARs) written using AI tools. This has been building for a few years now, and both the volume and sophistication are increasing. For any business that deals with customers, employees or the public, it is becoming a real drain on time and resources.

Many of these documents look impressive at first glance. They are logically structured, refer to legislation and often read as though they have been prepared by a lawyer. In many cases, though, they have been generated quickly and with little underlying substance. That said, it would be a mistake to dismiss a claim simply because it was drafted with the help of AI. Behind every AI-generated letter is a real person or business with a genuine grievance. What has changed is the ease with which these issues can be articulated and sent, not the substance itself.

Whatever the reason, the practical impact is real. Businesses are spending more time and resources on correspondence that demands attention, and potentially legal input, even where the underlying issue is weak. In the employment context, DSARs have long been used as a strategic tool, often alongside grievances or in anticipation of tribunal proceedings, and AI has made this even easier.

A reactive, case-by-case approach may already be unsustainable in the light of this increase. What matters now is understanding what has changed and responding in a structured, proportionate way.

What is driving the increase?

The barrier to bringing a complaint that looks “legal” has fallen dramatically. What once required professional advice, time and research can now be done in minutes with AI tools.

The resulting document may cite statutory rights, refer to case law and set out a coherent account of alleged wrongdoing. Businesses are then left dealing with correspondence that appears credible, even where the claim behind it has not been properly thought through.

At the same time, a new category of third-party provider has emerged. Some operate within a regulated framework, including AI-assisted law firms supervised by solicitors, but others do not. There are unregulated entities offering to pursue claims, draft legal correspondence and negotiate settlements, typically taking a cut of any payout, without the oversight that qualified solicitors and regulation provide.

The legal context

Under the Legal Services Act 2007, the "conduct of litigation" is a reserved legal activity that only authorised providers can carry out. But much of what businesses are currently seeing, such as letters of complaint, pre-action correspondence and settlement discussions, falls outside that definition, meaning anyone can do it.

How businesses should approach their response

The most effective approach starts at intake. Rather than treating all correspondence the same way, businesses should distinguish between individuals acting on their own behalf, regulated law firms and unregulated intermediaries. That distinction should shape how the response is framed and handled.

Verification matters. AI-generated correspondence can create a misleading impression of authority, so it is worth checking who is behind a claim and whether any representative is properly authorised. At the same time, businesses should keep engaging appropriately to avoid procedural risk.

Where appropriate, the role of unregulated providers can and should be challenged. If necessary, businesses should go directly to the individual behind the claim. In every case, a careful look at the substance remains essential.

A note of caution: your own use of AI

Recent cases have shown that uploading confidential material into public AI systems can effectively place that information in the public domain, risking a breach of confidentiality and waiver of legal privilege. Any use of AI should be within secure, approved systems.

What should your business do now?

Businesses should have clear processes in place for triaging correspondence, checking representatives and training staff. A sensible internal policy on AI use matters too. But critically, the response to AI-generated claims should still involve human judgement and, where appropriate, professional legal advice. AI may be changing how claims are presented, but the most effective response remains human-led.

If these processes are not already in place, now is the time to act. Early investment in the right structures and advice will save cost, reduce risk and limit disruption. It is the best way to make sure genuine issues are resolved before they escalate.

AI is changing how claims are generated, but not the law that underpins them. The people and businesses behind those claims still have real concerns that deserve proper attention. Those who respond with structure, sound judgment and the right expertise will be best placed to manage the risk and resolve disputes before they become costly.

Our Dispute Resolution team has experience in AI-Generated claims and how to tackle them. If you would like to discuss this article or any of your current and future needs, please do not hesitate to contact us.